Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Trina Solar (NYSE:TSL) dropped as much as 10% today after reporting fourth-quarter earnings.
So what: Solar module shipments were up 9% to 415 MW in the quarter, which was above expectations, and this led to revenue of $302.7 million, above expectations of $271.2 million. The problem is that revenue was down 30.5% from a year ago and it still couldn't bring the company near a profit. Gross margin was just 1.9% and the company lost $1.23 per share, $0.43 worst than what Wall Street expected.
Now what: There is no reason to be optimistic about the financial future of Chinese solar firms, including Trina Solar. The company isn't anywhere near a profit and debt continues to grow as it pays for its losses. I'm certainly not buying today and I would bail as quickly as I could if I were a shareholder.
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Fool contributor Travis Hoium has no position in any stocks mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.